Investing in the Family Atmosphere

By Paul Brent

It was a little over five years ago that Nicola Wealth Management achieved a goal of quardrupling the size of its business.

For most companies and management teams, that would be a time to sit back and celebrate. Instead, the Vancouver-based wealth management company, which is deep in long-term planning for its high-networth clients each and every day, decided to do some planning for itself and set out some audacious goals.

“We hit our goals and said, ‘Great, where are we going to go over the next five years? How do we quadruple again?’ ” says David Sung, Nicola’s president.

Among the transformational steps it took, Nicola hired an outside consultant who provided compelling evidence that top performing companies (stock price and profit growth) also had superior corporate cultures. Nicola, which was already well known for its family feel, was further inspired.

“A common trait shared by some of the world’s most successful companies is a world-class culture. Many studies have measured the relationship between the culture of a business – that is the passion, satisfaction and the happiness of those who work there – and the long-term performance of the business,” Sung says. “There is no comparison: the performance of companies with amazing culture far outpaces those that do not.”

As they did with their company’s business plan, NWM looked at the current reality of their company’s culture, set a vision of what they wanted their future to look like, and put strategies in pace for everyone at the firm to work collectively toward that future culture. “A company with a world-class culture does not have a hard time finding the best talent to work there, because it will have a lineup of great talent waiting to get in the door.”

The firm set out to create a world-class culture and looks to have succeeded. Nicola has been recognized by Waterstone Human Capital as having one of Canada’s 10 Most Admired Corporate Cultures (Growth and Small Cap category). The program, presented annually by Waterstone Human Capital, distinguishes outstanading workplaces where culture impacts performance.

One of the ways that the investment and advisory firm has set itself apart from its competitors is how it provides services and advice to clients. Unlike many companies in the financial services business, all of its advisors work together as a team, rather than in individual silos. It is a formal that ensures every client benefits from the team’s collective range of knowledge and experience, says Sung.

That team approach extends far beyond client service, however. “That engagement is not just happening at the advisor team level but at all departments,” he notes. “Also within our technology team, our accounting division and our portfolio management groups. We take a team-based approach across the firm.”

For an investment firm, where success is measured on performance and return on investment, the results of its culture shift are easy to identify: client retention is running at 99 per cent. Of equal importance: the generator of increased business – new client referrals – currently account for four out of five new customers hiring Nicola to manage their money.

Nicola has other numbers to measure its progress, including growing from locations in Vancouver and Kelowna, B.C., and opening new offices in Toronto and Richmond, B.C.

“We have doubled our offices, more than doubled the amount of people, but we have quadrupled the assets that we manage on behalf of our clients,” Sung says. Today, Nicola manages nearly $4 billion in assets for a client mix that includes affluent families, institutions and foundations across Canada.

Human resources manager Amy Boyer is a relative newcomer to Nicola, having joined the firm three years ago, but she has no difficulty explaining how employees live and breathe the culture every day. “People here have an abundance mindset,” she says. “They are highperforming, engaged and generous.”

That show up in the firm’s interactions with its clients, the community, and the staff as well.

The culture change has been driven by such initiatives as unique profit-sharing and ownership plans as well as “NWM Gives Back” charitable efforts.

“People genuinely care here. Not just about each other, but also our clients. We are not doing it just to make money, we are doing it to actually help them with their lives,” she says. “We care about their families, we care about how their livs are impacted by these financial decisions.”

That genuine care extends to profit-sharing in particular, which is a key component to keeping employees motivated and engaged.

“For the past five or six years, our employee profit share has on average been over 25 per cent of an employee’s base compensation,” says Sung. “That is a very meaningful amount for most people, and when they see that their individual effort translates into something meaningful for them and their family, I think that helps motivate the entire group.”

As well, key members of Nicola’s team are eligible to participate in the company’s shareholder plan through an options program. Based on their ongoing contributions to the growth of the company, they can increase their ownership postition in the company over time. Currently, 25 individuals are either shareholders or option holders, while all employees take part in the profit-sharing program.

“Both systems that we run have, I believe, contributed greatly to the engagement of all of the staff and stakeholders of our firm,” says Sung.